The report below provided by Hedge Solutions highlights some of the factors driving heating oil prices for New Englanders into September of 2017.
Hurricane Harvey Blew Out Crack Spreads
Hurricane Harvey slammed into the Texas coast near Corpus Christi a little over a week ago, and impacted crude oil production. But as the shale revolution has sharply cut the importance of offshore Gulf of Mexico oil production, the loss of a relatively small amount of crude oil output was far outweighed by the loss of refining capacity in the region.
The Gulf Coast is home to about half of US operable refining capacity, as of the week ending August 25, and about one fifth of US distillation capacity was shut due to Harvey. Consequently, refined product futures – particularly RBOB gasoline – rocketed higher while WTI crude oil futures initially fell and then saw much slimmer gains, as the major impact was reduced product supply and reduced crude oil demand.
To read the whole article in the latest Energy Procurement Report, just click on the image below to view the whole report full size:
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